Summary
TLDR: Digital Currency Group objects to settlement agreement between New York Attorney General and bankrupt crypto lender Genesis, arguing it violates bankruptcy law by favoring preferred creditors. DCG believes unsecured creditors should recover value based on distribution date, not petition date. Genesis settled with SEC and plans to offload $1.6 billion in Grayscale shares. Judge overruled DCG’s request to consult on shares.
Key Points
1. Digital Currency Group has filed an objection to the New York Attorney General’s settlement agreement with bankrupt crypto lender Genesis.
2. Genesis, as part of the proposed agreement, would cease current and future business activities in New York.
3. DCG alleges that Genesis would “take value from lower classes and redistribute it to preferred creditors in violation of absolute priority.”